Residential market accounts for 80% of cranes in capital cities

Populating the skyline of Australia's cities, the number of cranes observed in Australia have grown from 113 to 539. The continuing strength of the residential sector across Australia has seen an extra 117 cranes commence work on residential sites, representing an overall increase of 38 % more cranes. We shed light on the RLB's newly released Crane Index.

The report measures crane movements across Australia in the past six months, with the last publication released in April 2015.

According to the Q4 RLB Crane Index, 301 new tower cranes were erected across Australia’s skylines in the past six months, proving the construction industry is still undergoing significant growth. This count was offset by the removal of 188 cranes from sites around Australia, which are nearing completion.

“Based on our research, 79.2% of all cranes erected across the country are on residential projects, while only 8.7% of the total number are erected on commercial projects. 65% of the residential cranes are located in Sydney and Melbourne. Cranes erected on the east coast of Australia amount to 89.4% of all cranes sighted in Australia.”

“The concentration of residential cranes within key cities identified within the RLB Crane Index is a testament to the inner-city housing challenges facing our key cities,” he said.

"Those of us in the building industry should all be very grateful that the market is doing what it's doing," said Brookfield Multiplex chief executive John Flecker, of the high proportion of residential work.

"I don't think, as an industry, it's catastrophic. These things do cycle and the other sectors will pick up. If all you did was residential and you grew substantially because there's a lot of work at the moment, you'd have to question how sustainable that was in the longer term, but if you're diversified, you should be fine."

Sydney remains the construction king with the greatest number of cranes erected in the residential (170), commercial (18) and civic (15). Melbourne dominated the retail (6). The Gold Coast is showing a state of recovery with the addition of 8 cranes and removal of 7 cranes to total 16 cranes currently on the skyline.

The positive growth of crane numbers across the country, corresponds with the amount of construction work done. Significant increases in the volume of apartment construction is enabling the growth of cranes across the skyline of Australia.

Asian developers and foreign investors continue to flex their muscle in the residential development market with recent significant site acquisitions and developments underway in Brisbane, Melbourne and Sydney.

KEY FINDINGS

Adelaide

7 cranes observed in total (up one crane since last index in April)

educational sector represents 43% of all cranes currently in use

residential and commercial projects account for 43% and 14% of all cranes respectively

seeing consistent value of both residential and non-residential work being completed for the past six financial years but a considerable drop in the value has been seen in Engineering works (a fall of $1.9b from the high of 2012/13)

Brisbane

104 cranes observed in total (up 31 since last index), represents 42% increase compared to cranes observed in Q2

strong growth in health, education and civic sectors has seen an additional 9 cranes collectively commence

cranes on health projects have doubled since last count, with 6 cranes now sitting on health projects

four new cranes have been seen on education projects

civic sector accounts for 7% of all cranes in Sydney

retail sector declined by one crane during the period (from 4 to 3)

The surge in the residential sector has helped lift confidence in the property and construction industries in the past quarter. So with housing, apartment, multi-storey projects continuing to grow, it's a powerful tool to know how to get the best value rates for your project.

Construction professionals that understand the changing market are better equipped to provide value to their client. We know it’s time consuming to research this from scratch, so we’ve written a guide on the 7 Factors Affecting Plant Hire Rates. Download your eBook today by clicking below!

As the Content editor at plantminer.com.au, Sophia works behind the scenes to keep our blog machine in motion. A student of Law and Business, she's very dependent on coffee and loves any excuse to travel.